Farm min may allow duty-free maize import as supply shortage looms

February 9, 2019

MUMBAI – The farm ministry may allow import of up to 500,000 tn non-genetically modified maize at zero duty under the tariff rate quota as supply is seen way short of estimates, sources said. This is a marked dilution from the ministry's previous stance of not allowing duty-free import of maize.

"The (farm) ministry has now given a report saying there is a shortage of maize in the country," said a source, adding that the report will be a basis for the finance and the commerce ministries to take a decision on imports.

Import of maize has been necessitated in the wake of rising prices in the spot market, triggered by low supply. The poultry and starch industries have been severely hit due to the over 50% rise in prices of maize to a record 2,100 rupees per 100 kg from 1,400 rupees in the last few months. The supply crunch stemmed from lower crop estimates for kharif and rabi season.

Though the farm ministry has estimated kharif maize production for 2018-19 (Jul-Jun) at 21.5 mln tn, the industry expects production to be much lower at 13-16 mln tn.

In January, Cogencis had reported quoting farm ministry officials that the ministry was not in favour of importing maize at zero duty as it could hurt interests of Indian farmers ahead of rabi harvest.

Low monsoon rains and pest attacks in key growing regions of Karnataka, Andhra Pradesh, Telangana and Maharashtra seem to be affecting the production.

Poultry and starch industries have been lobbying for a duty-free import of maize, claiming that supply is not enough to meet demand, which is estimated at roughly 2 mln tn a month.